The first definitions of FinOps as such, arise during the period of 2018 – 2020 to consolidate as a framework or financial culture in the cloud world and be sponsored by the FinOps Foundation.
Today there are more than 10.000 FinOps practitioners and more than 80% of enterprises in US are looking for a way to work, a financial culture, to allocate cost and understand the OPEX challenges that public cloud brings up.
In EMEA, we are getting on slower. Countries such as UK, France, Germany, Italy or here in Spain expect a strong expansion of FinOps culture in their companies (even SMB) as well as public sector.
But why is there so much confusion about what objectives this framework has?. Well, to be honest, there are a few misunderstandings that have led to this situation.
Finops is something we are still doing, we are using RI, we usually resize VMs and delete Orphants elements, even we are doing tagging properly
Cloud Economics, all related to optimize cloud spending with our engineers from a technical perspective, is part of Finops. Indeed, there is a capability called “Resource Utilization & Efficiency” and another called “Workload Management & Automation” that cover those scenarios when we need to optimize a cloud or multicloud environment.
Finops is just about save money and reduce cloud consumption
Finops is a culture to integrate Financial team, IT Engineers, procurement, PMO and CIOs and broke silos in order to allocate cloud cost, understand the appropriate cost metrics and ROI for each business or motivations to invest in the cloud. It is about being cost – effective, not just about save money.
Finops doesn´t make sense. It doesn´t provide any value to our business
Some roles as CTO, Engineers, some IT managers don´t see any value in a framework such as Finops. They think it´s too much “High Level”, maybe a fashion. It´s remarkable, they are technical people and don´t see technologies are needed to support a business. We have to pointed out here, public cloud ends up in caos if you don´t understand how to manage cloud cost in a new OPEX world.
When we buy a Cost Management Console, we will be moving faster to a RUN phase within FINOPS
This is not the approach, if you buy a cost console tool such as Cloud Health, Cloudability or whatever in the market, this is just a tool, you need to adapt to your cloud provider or multicloud solution together with governance, automation, forecast, budget strategies, etc.
If you have a FINOPS Team and you have applied some Finops principles, follow up stages, use a cost management console with some reports, you are done.
This is the start of a journey. Even if you set up a FINOPS TEAM, and you think you are on the way to a RUN stage, you need to be sure, your CEO and executive staff push down this culture, you need to be sure you have appropriate business metrics and the cost allocation and owners are part of your company culture. This is a cycle of cost effective optimization.
In the coming post, i am going to underline more confusing concepts about FinOps and deep dive in the possibilities that this framework provides to Finance and CFO´s roles.
Enjoy the journey to the cloud with me…see you soon.